The EU Recovery Fund (NGEU) and Hungary — 2020–2026
Why are nearly 10 billion euros in EU funds not reaching Hungarian citizens? What conditions must be met, why does the government refuse to meet them, and whose interests does this serve? Below, we examine the situation based on European Commission documents, European Parliament reports, Transparency International, the Hungarian Helsinki Committee, and the international press.
The largest economic recovery programme in EU history
NextGenerationEU (NGEU) is the EU's €806.9 billion economic recovery programme, established in late 2020. Its centrepiece is the Recovery and Resilience Facility (RRF), worth €723.8 billion in grants and loans. For the first time ever, the EU borrowed jointly on behalf of Member States.
Member States were required to submit national plans, committing to reforms and investments in six areas: green transition, digitalisation, economic resilience, social cohesion, healthcare, and preparing the next generation. Access to funds is conditional on meeting milestones and targets, verified by the Commission with each payment request.
Final deadline: 31 August 2026 — all milestones must be met by then. The Commission must make final payments by 31 December 2026.
Hungary's RRF allocation and disbursements to date
The Council approved Hungary's plan on 15 December 2022. The original allocation was €5.8 billion in grants. In 2023, with a revised plan and a REPowerEU chapter, the total rose to €10.4 billion: €6.5 bn in grants (incl. €0.7 bn REPowerEU), €3.9 bn in loans. The plan represents 7.1% of GDP (2019 basis), with 66.9% dedicated to climate objectives and 29.1% to digital targets.
So far, Hungary has received only REPowerEU pre-financing: a total of €0.92 billion (€0.14 bn in grants + €0.78 bn in loans). This is disbursed automatically upon plan approval — it is not linked to a payment request.
Hungary has never submitted a single payment request — this requires the full and satisfactory fulfilment of all 27 super milestones. The operational arrangements have not been signed either.
Hungary is the only EU Member State that has not received any RRF payment. The EP's 2025 RRF report states: "all but one Member State have satisfactorily fulfilled their super milestones."
Rule of Law Conditionality Regulation: ~€6.3 bn in cohesion funds (of which ~€2.12 bn permanently lost at the end of 2024–2025).
Common Provisions Regulation (CPR): ~€11.7 bn in cohesion funds (EU Charter of Fundamental Rights horizontal enabling condition).
RRF super milestones: ~€9.5 bn in recovery funds.
Total: ~€18 billion frozen (as of July 2025). In addition, a daily penalty of €1 million (since June 2024) for non-compliance with an ECJ asylum ruling.
The history of the freeze — year by year
Conditions for payments — commitments Hungary itself agreed to
Milestone 215: Removing obstacles to the preliminary reference procedure (referrals to the ECJ).
Milestone 216: Public authorities can no longer challenge final court decisions before the Constitutional Court.
Milestones 213–214: Strengthening the National Judicial Council (legal personality, own budget, supervisory powers). Reform of the Curia (Supreme Court).
*Warning: According to the Helsinki Committee and civil society organisations, in 2024–2025 new legislation and the Curia's uniformity complaint proceedings undermined the results of the reforms. The EP challenged the Commission's positive assessment at the ECJ.
Integrity Authority: established, but faces operational obstacles. Its president publicly signalled the government's lack of cooperation.
Anti-Corruption Task Force: created, but no tangible impact.
Public procurement competition: the share of single-bid procedures has barely declined (EU average ~20–25%, Hungary ~30–40%). Government-connected companies remain the primary beneficiaries.
Asset declarations: the system was reformed, but enforcement is weak.
Prosecution of high-level corruption: no meaningful investigations into government-connected individuals. Judicial review of prosecutorial decisions not to investigate remains non-binding.
Public interest trusts: this is the issue where negotiations stalled permanently in January 2024. These trusts control two-thirds of Hungarian public universities, with Fidesz-connected board members, and have been excluded from EU funding.
The introduction of the Arachne risk-scoring tool and the establishment of the audit system have been formally completed, but the Commission and Hungary have not signed the operational arrangements — a prerequisite for submitting payment requests. This is not possible until all super milestones are met.
Summary (TI Hungary, November 2025): out of 27 super milestones, 17 fully met, 9 partially met, 1 not met. Partial fulfilment is not sufficient — under the RRF Regulation, all must be fully met before the first payment request.
What Fidesz-KDNP claims, and what the sources show
The freeze is based on three EU regulations: the Rule of Law Conditionality Regulation (upheld by the ECJ: C-156/21, C-157/21), the RRF Regulation's super milestone mechanism, and the Common Provisions Regulation. These are legal instruments, not political tools.
The conditions are not about migration or LGBTQ policy, but about anti-corruption measures, public procurement competition, and judicial independence. The 17 anti-corruption measures were proposed by the Hungarian government itself.
TI Hungary and the Helsinki Committee's November 2025 assessment: out of 27 super milestones, only 17 have been fully met. The Commission on 8 July 2025: no progress on 7 out of 8 recommendations. The Commission spokesperson (December 2024): the loss is "irrevocable, and Budapest has no right to appeal."
EU funds are not an automatic entitlement but conditional support — the same rules apply to all Member States. Hungary itself accepted the conditions attached to its plan. The money comes from the common EU budget, to which all Member States contribute. No one is "taking it away": Hungary can access the funds at any time by meeting the conditions it agreed to.
In the event of a veto, the old budget would be extended proportionally — which, due to NGEU loan repayments, would result in a net loss for Hungary. The veto does not extend the RRF's 31 August 2026 deadline. The blackmail strategy is also legally problematic: a case is pending before the ECJ regarding "quid pro quo" suspicions around previously released Hungarian funds.
The measures the EU requires — judicial independence, anti-corruption framework, public procurement competition — are norms that Denmark (CPI 89), Finland (88), the Netherlands (79), and Sweden (80) voluntarily maintain. These are not restrictions on sovereignty, but tools of good governance — with proven economic benefits.
Hungary's CPI score: 41 — last in the EU for the third consecutive year. It has dropped 14 points since 2012.
Absorption rates and the Polish example
| Country | RRF allocation | Disbursed | Rate | Status |
|---|---|---|---|---|
| 🇫🇷 France | €40.3 bn | ~€30.8 bn | ~77% | EU frontrunner |
| 🇮🇹 Italy | €194.4 bn | ~€140 bn | ~72% | Largest beneficiary |
| 🇩🇪 Germany | €28 bn | ~€18.3 bn | ~65% | |
| 🇪🇸 Spain | €163 bn | ~€71 bn | ~44% | |
| 🇵🇱 Poland | ~€59.8 bn | ~€20.9 bn | ~35% | Accelerated after govt change |
| 🇧🇬 Bulgaria | ~€6.3 bn | ~€1.8 bn | ~29% | |
| 🇭🇺 Hungary | €10.4 bn | €0.92 bn | 8.8% | Pre-financing only, 0 requests |
Under the PiS government, ~€136 billion was frozen. After the change of government in late 2023, Donald Tusk's new administration submitted an action plan within months, and by early 2024, the Commission began unlocking virtually all funds. This proves that the conditions are achievable when there is political will.
The price paid by Hungarian society
In the first 10 months of 2025: €1.6 bn paid in, €1.55 bn received back. For the first time since EU accession, Hungary became a net contributor — solely due to the frozen funds. Membership fees must still be paid regardless.
GDP: -0.8% in 2023, averaging +0.5% in 2024–2025 — below the EU average.
Deficit: ~5% (2025–2026) — well above the EU's 3% target.
Permanently lost: ~€2.12 bn in cohesion funds (end of 2024–2025) — irrevocably.
Daily penalty: €1M/day (~€365M/year) for the asylum ruling.
CPI 2024: 41 points — last in the EU for the third year. Down 14 points since 2012.
If the super milestones are not met, the entire ~€10.4 bn RRF allocation will be permanently lost — roughly 5% of GDP. Schools, hospitals, energy efficiency, digitalisation, and transport improvements will not materialise.
Even in the event of a change of government, time is questionable: fulfilling super milestones, the Commission's assessment, and signing operational arrangements would take months.
The conditions do not violate sovereignty. Judicial independence, anti-corruption frameworks, public procurement competition — these are voluntarily maintained by Denmark (CPI 89), Finland (88), and Sweden (80), and deliver proven economic advantages.
The conditions are achievable. Poland's example proves it: funds can be unlocked within months when there is political will.
The failure to comply is political, not economic. Academic research (Scheppele–Morijn, 2024; JEPP, 2025) concludes that the government made a deliberate cost–benefit calculation: the political cost of certain reforms — jeopardising the corruption system, surrendering control over public interest trusts — exceeds the economic benefit from the funds, at least from the perspective of maintaining the current power structure.
The main obstacles concern the foundations of the power system. Public interest trusts ensure Fidesz-connected control over universities. Increased public procurement competition would threaten the oligarchs. Greater prosecutorial accountability would risk exposing high-level corruption. The government does not fail to meet the conditions because it cannot — but because it does not want to.
The damage is borne by Hungarian citizens. The lost funds were intended for schools, hospitals, energy efficiency, and transport. Meanwhile, membership fees must still be paid, and Hungary became a net contributor in 2025. TI Hungary's finding: "corruption undermines economic output, and declining economic output reduces available resources."
Time is running out. The RRF deadline of 31 August 2026 cannot be extended. If the current government does not meet the conditions, the €10.4 billion allocation (~4,000 billion HUF) may be largely lost forever.
Documents and articles used in this analysis